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Psa 210 & 220

PSA 210 discusses terms that should be agreed upon for audit engagements, including management's responsibility to present financial statements according to applicable frameworks and the auditor's unrestricted access to evidence. PSA 210 also specifies what should be included in an engagement letter, such as objectives, responsibilities, and expected reports. If terms need to change, the auditor should record the new terms or withdraw. PSA 220 covers quality control procedures for auditing financial statements. It discusses the audit firm's responsibility to maintain quality control systems and the engagement quality control reviewer's responsibilities. PSA 220 provides criteria for auditors to evaluate a company's quality control in auditing financial statements and determine if the auditor's report is appropriate. It also requires

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413 views1 page

Psa 210 & 220

PSA 210 discusses terms that should be agreed upon for audit engagements, including management's responsibility to present financial statements according to applicable frameworks and the auditor's unrestricted access to evidence. PSA 210 also specifies what should be included in an engagement letter, such as objectives, responsibilities, and expected reports. If terms need to change, the auditor should record the new terms or withdraw. PSA 220 covers quality control procedures for auditing financial statements. It discusses the audit firm's responsibility to maintain quality control systems and the engagement quality control reviewer's responsibilities. PSA 220 provides criteria for auditors to evaluate a company's quality control in auditing financial statements and determine if the auditor's report is appropriate. It also requires

Uploaded by

anna rodriguez
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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PSA 210 : AGREEING THE TERMS OF AUDIT ENGAGEMENTS

It talks about the management integrity such as presenting the finacial statement of the company
according to the applicble network such as the generally accepted accounting pronciples (GAAP)for
general purpos of the FS. It has the presence if the internal control that enables fair presentation of the
FS. Example framework is the IFR, PFRS and the IPSASs. Another thing is the auditor must have
unrestricted access to obtain evidenc for the purpose of auditing a company's FS. The auditor shall not
accept any limited engagement in audit engagement unless required by law or by the regulation to do
so.

PSA 210 enumerates the engagement letter's content which includes the objective and scope of the
audit of the FS, the responsibilities of the auditor and the management respectively, the framework
applicable for the preparation of the FS and the references to the expected form and content ofany
reports to be issued by the auditor and a statement that provides that there may be a differ in the
expected form and content.

If the auditor wants to change the terms in the engagement letter, he can just record the new term if it is
reasonably to justify and if not, just to withdraw.

PSA 220 : AUDITOR'S REPORT

PSA 220 talks about with the responsibilities of the auditor that are specific regarding the providing of
quality control procedures for an audit of financial statements. It is, where applicable, the
responsibilities of the person which is known as the engagement quality control reviewer. This PSA is to
be read in conjunction with relevant ethical requirements.

The responsibility of the audit fir includes the quality control systems, policies and procedures. The firm
must maintain the quality control of the audit because the result of the audit will reflect on the image of
the company. If the quality of control is low, it means that the company has a difficulty in the operation
of business and the auditor, in result, must gather more evidence on how and why the company’s
performance is declining. To determine what is the appropriate solution for the company to improve
mor, the auditor’s help and role is needed. The audit engagement will bring the firm with relevant
information to enable the functioning of that part of the firm’s system of quality control relating to
independence.

By using the criteria set by PSA 220, auditors can tell if the company has quality control in audit of
financial statemens, the audit complies with professional standards and regulatory and legal
requirements; and the auditor’s report issued is appropriate in the circumstances faced by the company
they are auditing. According to PSA 220, the company must have engagement quality control review
which is the process designed to provide an evaluation on or before the date of the report to have a
useful decision that can make help the company they are auditing.

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